Law allows young adults to stay on parents' insurance until age 26

Corey Hess
Under the new health reform law, Corey Hess, 24, could be included in his mother's health care plan. Until that happens, he avoids seeing the doctor despite recent illness and carpal tunnel in his hand from drumming and using a hammer.
MPR Photo/Caroline Yang

Corey Hess is a busy man. He's a carpenter for a remodeling company, a recording engineer on freelance projects and a drummer in a band called "More than Lights."

But despite all the hours he works, Hess, 24, has had no health insurance for three years. He was last covered while in college by his mother's plan through her employer.

"It's a little stressful," said Hess, of Brooklyn Park. "I do my best to stay healthy and just cross my fingers like a lot of people are doing."

INSURANCE COSTS PROHIBITIVE FOR MANY

Hess is among more than 13 million uninsured young adults, many of whom lost their health care coverage after graduating from high school or college. One out of every three adults between the ages of 19 and 30 is uninsured, according to the Commonwealth Fund, a foundation that advocates providing health care to the uninsured.

A provision of the nation's new health care law would allow some young people to stay on their parents' insurance until age 26.

The newly reinsured could include Hess, who wields drumsticks, swings hammers, and slides buttons in a recording studio. He's noticed some tenderness in his wrists and hands. It's something he'd like to ask a doctor about, but he hasn't seen one in a while. He thought about seeing one earlier this week after flu-like symptoms left his voice raspy.

"I stayed home from work and definitely had severe enough symptoms where I thought about going into the doctor, but just held it off for as long as possible," he said. "I didn't have a few 100 bucks kicking around to pay for a doctor bill."

Hess looked into buying insurance on the open market, but found it too expensive. The premium was a couple hundred dollars a month, but the policy had a $5,000 deductible. After that, insurance would pay 80 percent of his bills.

If Hess were covered by his parents' insurance, it's likely that he would pay less for better coverage because he'd be in a bigger risk pool. That's something he'd be very interested in doing.

LAW WILL STANDARDIZE RESTRICTIONS

About 30 states, including Minnesota, already allow some parents to include adult children on their health insurance. But each state has its own restrictions. Iowa, for example, requires unmarried adult children be full-time students. Minnesota doesn't.

Minnesota requires adult children be dependents and coverage is available only to age 25 unless the child is disabled. New York allows an unmarried child to remain on a parent's insurance up to age 30.

Federal law has few restrictions other than an age cut off at 26 and that the adult child cannot obtain insurance through an employer, said Sara Collins, a researcher for the Commonwealth Fund.

"The language is really broad and it states that young adult children can stay on their parents' policies, or can be insured on their parents' policies," said Collins, the organizations' vice president for the affordable health insurance program.

Corey Hess
Corey Hess, 24, of Brooklyn Park, has been without health insurance for the past three years. By day he works as a carpenter for private homes, and in the evenings he plays drums for the band "More Than Lights." Under the new health reform law, he could be included in his mother's health care plan.
MPR Photo/Caroline Yang

She said Secretary of Health and Human Services Kathleen Sebelius is expected to release guidelines and regulations soon on eligibility.

In about four years, the health care law will require everyone to obtain health insurance, including young adults like Corey Hess. It will create a Web-based health insurance marketplace where people can buy insurance through an exchange.

University of Minnesota Health Economist Roger Feldman said there is a financial incentive for the government to keep young people on their parents' policies.

"Because if they go into the exchange...the taxpayers [have] to provide them with a subsidy," Feldman said. "If they go under their parent's policy, the cost of that is paid by all the people [through] the employer, not by the government to subsidize the exchange."

PARENTS' PREMIUMS WOULD GO UP

One question is whether parents would want to include their adult children on their policies. Their premiums will go up and they may end up paying for their adult children -- as well as themselves.

Hess' mother, Kathy McQuillan, has insurance through her job at a Virginia, Minn., hospice. McQuillan said her son is very responsible and she has no doubt that if she were able to include him on her insurance that he would help pay his share. She worries about her son's health and would definitely consider including him on her insurance but does find the process a bit odd.

"I look at this particular way as kind of a strange, convoluted way of extending childhood and dependency," McQuillan said. "But if it's the only way we can get that age group covered, I guess that's what we've got to do in the current situation."

The law says young adults can go on their parents' insurance beginning this fall or when a parent's insurance comes up for renewal. In McQuillan's case, that would be right after the new year.

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